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Juneau's biggest economical problem is also its oldest

Posted: November 24, 2013 - 12:06am

The number one economic development problem in our community is also our oldest problem. Community concern that a lack of buildable land for housing in Juneau would impede the ability of the community to grow and prosper was first mentioned by Miner Bruce in 1895.

Bruce wrote: “Juneau is rightly called the metropolis. Whether she will retain this prestige remains to be seen. If so, one of two things must occur. She must plane down the sides of her mountains or erect skyscraping buildings with elevators to accommodate her populace, for nearly every foot of available ground is already occupied.”

In James Michener’s Alaska, the story’s young protagonist comes to Juneau in the early 1900’s and tries to find a place to live. “Usable land was so scarce and precious in Juneau that Tom was unable to find either a house already built or land on which to move, and although he liked the town and considered the mountains which edged it into the sea picturesque, he began to despair of ever finding a place there in which to live.” Tom never does find a home and decides to move on, and in this way Michener’s tale is eerily reminiscent of countless stories over the last few years of young families departing after a less than fruitful housing search.

Two years ago, I conducted an analysis for the Juneau Housing Assessment showing that Juneau needed at least 350 new housing units just to meet pent-up housing demand. Despite this scarcity, in the last two years we managed to grow our population by another 1,600 people. Since our average household size was 2.5 people per housing unit in the last Census, these new residents effectively created a need for 640 additional housing units. This means that in order to meet existing local demand we need 1,000 new units (an increase of 7 percent).

Resourceful twenty-something millennials compile roommates, turning rental homes into dorms. But those not wanting to share their space, from businessmen to families with small children, often find themselves out of luck in our brutal housing climate.

According to the Alaska Housing Finance Corporation, vacancy rates for efficiency apartments and three bedrooms homes in Juneau were at zero percent in 2013, while the overall apartment rental vacancy rate was 2.7 percent. By this measure, we have the tightest housing market in the state, and are significantly lower than the national average of 9.3 percent.

The combination of lack of housing and high housing costs continues to be an obstacle standing in the way of our expanding local economy.

The top two measures of a growing economy are an increasing populace and a growing job market, and in Juneau we have an artificial lid on the top of our economy in the form of housing — or lack thereof. In order for Juneau to have an economy capable of further growth, there simply needs to be a much higher level of housing abundance.

Clearly we have added many homes to our community since Miner Bruce wrote his commentary in 1895, but this is a problem that will not go away if we continue to react to it with small-scale solutions primarily geared toward the creation of housing for lower income residents. We also need a high-end, large-scale housing vision that will simultaneously provide new options for our seniors to stay in Juneau, while providing business professionals an opportunity to move here with their families. (Yes, you — staying at a hotel and visiting your spouse, kids and dog on the holidays because you haven’t figured out how to move them here yet, despite your nice new job.)

By increasing the housing pie, prices will begin to self-correct across the spectrum, thereby increasing housing affordability for everyone.

Perhaps after nearly 120 years, it is time to construct a large-scale housing vision worthy of Miner Bruce’s mountain-embedded skyscraper. Regardless, it’s time to take that housing lid off of our economy.

• Meilani Schijvens, a lifelong Juneauite, is the author of Rain Coast Data, a monthly column of the Juneau Empire analyzing regional and local data trends. She has 20 years of professional and academic focus on the economic, transportation, and natural resource issues of Southeast Alaska.

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